Medical Marijuana Legislation Update

The Washington Legislature is currently considering two bills relating to medical marijuana or cannabis. The first bill, ESSB 5073, passed the Senate on March 2nd, with a vote of 29 yeas and 20 nays. The House Committee on Health Care & Wellness held its first public hearing on ESSB 5073 on March 14th and will hold an executive session on March 21st.

ESSB 5073 would establish a regulatory system for producing, processing, and dispensing cannabis intended for medical use; establish protections from criminal liability and arrest for qualifying patients, designated providers, health care professionals, licensed producers, licensed processors, and licensed dispensers; and establish a voluntary registry in which qualifying patients and designated providers may enroll and receive arrest protection. The Department of Agriculture would administer the licensing program for producers and processors, and the Department of Health would establish a regulatory system to issue credentials to licensed dispensers. Dispensers will only be able to sell cannabis that they have received from producers or processors, and they may only sell to qualifying patients, designated providers, or producers. Prior to selling or delivering cannabis to a patient or designated provider, the dispenser will have to contact the patient’s health care provider to confirm the patient’s qualification for obtaining cannabis for medical use. Importantly for cities and towns, the legislation provides that licensed dispensers may not sell cannabis in any city or town without first being authorized to do so by the city or town council. Further, municipalities are able to adopt “reasonable” zoning requirements, business licensing requirements, or business taxes pertaining to the production, processing, or dispensing of cannabis products that are adopted pursuant to their authority and duties under the Growth Management Act. There is no indication in the bill analysis and reports what the legislature considers to be a “reasonable” zoning, business licensing, or business tax requirement. However, the legislation calls for a study to be completed by July 1, 2014, which would examine, among other factors, diversion of cannabis intended for medical use to nonmedical uses and incidents of home invasion burglaries, robberies, and other violent and property crimes associated with qualifying patients accessing cannabis for medical use, which could eventually become useful in creating a legislative record for municipalities in regulating producers, processors, and dispensers. Finally, the legislation addresses cannabis producers and dispensaries currently in operation. According to Section 1201 of the bill, the legislature intends that currently-operating producers and dispensaries become licensed, but they will not be able to become licensed until the Department of Agriculture and the Department of Health adopt their regulations. Thus, currently-operating producers and dispensaries are likely to remain unlicensed until July 1, 2012, and consequently, owners run the risk of arrest between the effective date of ESSB 5073 and the time they become licensed. Nevertheless, the legislature has provided an affirmative defense to those currently-operating producers and dispensaries if charged with a violation of state law in the interim. To be eligible for this affirmative defense, the following criteria must be satisfied:

In the case of producers, solely provide cannabis to cannabis dispensaries for the medical use of cannabis by qualified patients;

In the case of dispensaries, solely provide cannabis to qualified patients for their medical use;

Be registered with the secretary of state as of May 1, 2011;

File a letter of intent with the department of agriculture or the department of health, as the case may be, asserting that the producer or dispenser intends to become licensed in accordance with ESSB 5073 and rules adopted by the appropriate department; and

File a letter of intent with the city clerk if in an incorporated area or to the county clerk if in an unincorporated area stating they operate as a producer or dispensary and that they comply with the provisions of this chapter and will comply with subsequent department rule making.

Upon receiving a letter of intent, the department of agriculture, the department of health, and the city clerk or county clerk must send a letter of acknowledgment to the producer or dispenser. The producer and dispenser must display this letter of acknowledgment in a prominent place in their facility. Left unanswered is whether this provision overrides city zoning and business license requirements that may apply.

In addition, the legislature is considering HB 1550, though the last action was a public hearing before the House Committee on Public Safety & Emergency Preparedness on February 8th. HB 1550 would legalize possession of cannabis for adults over the age of 21 years old. Under HB 1550, licensing, taxing, and selling cannabis would occur under the regulation of the Liquor Control Board (LCB). A state tax of 15 percent per gram of cannabis sold would be imposed, and agricultural farmers wishing to produce, process, or package cannabis would have to obtain a license through the LCB at an annual cost of $5,000. Cannabis and hemp products would be sold in liquor stores to adults (similar to alcohol) and regulated by the LCB. However, it would be a gross misdemeanor offense to: (1) sell cannabis without a valid license; or (2) distribute cannabis to a juvenile under the age of 21 years old. Adults could grow cannabis for personal use within certain specifications. If passed, this bill would not take effect until July 1, 2013.